Tax consequences when selling a house I inherited in Lexington

Inheriting a home is a pretty sweet experience, yet bitter at the same time… You are left with great property value you can use to improve your life, but you are still mourning the loss of a loved one. So you may tend to ask yourself at this point “what are the tax consequences when selling a house I inherited in Lexington KY?” The tax laws have been designed in a way they will not add any more burden unto you upon inheriting the property. This implies that the financial consequences are less daunting than what you would expect, which is good news for you. 🙂

Tax Consequences when selling a house I inherited in Lexington KY

Calculation of basis
In order to comprehend how you’ll be taxed having inherited a home, you need to know how basis is calculated. Basis, in this case, refers to the asset cost for purpose of the calculation of capital gains along other taxes. When a person dies, the value or basis of their property in Lexington is increased to the market value as at the time of their death. For instance, if a person purchased a home 20 years ago for $25,000 but it was worth $100,000 at the time of their death, that property would be valued at the latter amount for the purpose of calculating capital gains.

Taxation of gains/losses

Capital gains or losses refer to what you earn from selling property that you use for either personal or investment purposes. Such can be houses, furniture and many more things. If you decide to sell an inherited home in Lexington, that sale is regarded as capital gain or loss for the purpose of income tax. In most cases, for you to qualify for lower rates of long-term capital gains, you are required to have held that property for at least a year. However long the duration you have been in ownership of an inherited home, any gain or loss will still be treated as long-term.

Reporting the sale

Upon selling an inherited home, you have to report it for the income tax purposes. You should first calculate your capital gain or loss. This is done by subtracting the basis from the sale amount. You should then report that amount to the necessary authorities.

Having an inherited home can be stressing given the fact that you have new property to take care of and pay taxes for it at the same time… You should go through the probate process in Lexington as the first step to selling your home. The court will then authorize you to proceed as you wish. If there are any other individuals involved in the inheritance, you should first agree with each other on that decision. You can then file a petition requesting the court to allow you to sell the property.

You should then consider how much tax you are to pay. This will be paid against the capital gains or losses resulting from the sale of the house. You can call Bluegrass Investment Properties LLC now at (859) 321-6618 to undertake a smooth and legitimate sale of your home. We are local here in Lexington KY and we know the market here better than anyone else. If you are still asking yourself what are the tax consequences when selling a house I inherited in Lexington, then we would be happy to discuss it with you in more detail.

Selling an inherited house can relieve you of quite a burden. In addition to that, selling the property to an investor is a basic simple and fast process. Contact us for inquiries on how to go about things when selling your home in Lexington and we will be glad to help you.

Testimonials

I felt that I was making a new friend!

I can honestly say that selling my house to Clark was a smooth process from first contact to the final closing. I spoke to several potential buyers of this house, but Clark stood out for his courtesy and his frankness from the first time we met. I especially appreciated that he treated me with respect and friendly interest in my goals. The house needed more work than I wanted to deal with before putting it up for sale, but I never felt that Clark was judging me or being condescending towards me. He arranged the house inspection, the title search, and the legal aspects of the sale very quickly and very professionally. The entire process took only a couple of weeks. I had dreaded having to deal with the sale of this house but Clark was an absolute pleasure to work with and he made the process painless. I felt that I was making a new friend.

Rebecca King

He was a blessing! … He helped me out tremendously!

I found Clark online … I was in a very hard spot … He’s a really nice man … He helped me out … Everything went smooth … I was surprised to see how smooth it went … In a couple of weeks or so, he had everything ready for me … I came in and signed and everything was smooth … He was a blessing … He helped me out tremendously … Everything went good.

Bobby Robinson

He really helped me out of a sticky situation!

My mother had passed away … I knew that I had a house to get rid of … Clark quickly took care of everything … He really helped me out of a sticky situation … Here we are today at closing and it’s not even been a month … It’s been an easy road … It’s been really nice working with Clark … He is a genuine person and you can tell he knows how to do business the right way.

Rick Durram

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